This paper investigates the regulatory treatment of AI-driven robo-advisors in the insurance sector under European Union law. It analyses the interaction between the European Union Insurance Distribution Directive (IDD), which provides a sector-specific framework for consumer protection, product oversight, and distributor conduct, and the European Union Regulation on artificial intelligence (the EU AI Act), which introduces a horizontal, risk-based regime for AI systems. The paper argues that while both frameworks share core objectives—risk management, transparency, and accountability—their regulatory logics diverge. The IDD relies on human oversight, personalised suitability assessments, and conflict-of-interest safeguards, whereas the AI Act prioritises technical compliance, quality management, and conformity assessments for high-risk AI systems, including those used in underwriting and pricing. These differences may give rise to regulatory fragmentation and gaps in consumer protection when AI-driven distribution tools operate across both regimes. The paper identifies areas of convergence, potential conflicts, and unresolved questions surrounding algorithmic decision-making, liability, and supervisory coordination. It concludes by recommending greater harmonisation, including sector-specific guidance and enhanced cooperation between insurance and AI regulators, to ensure that innovation in AI-based insurance distribution aligns with the EU’s legal standards and fundamental rights protections.